Ichigo REIT October 2011 Fiscal Period
Corporate Presentation
December 15, 2011

Ichigo Real Estate Investment Corporation
Ichigo REIT Management Co., Ltd.

The former FC Residential Investment Corporation and former Ichigo Real Estate
Investment Corporationp
mergedg on November 1,, 2011. FC Residential Investment
Corporation was the surviving corporation, and was renamed Ichigo Real Estate
Investment Corporation.

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

www.ichigo-reit.co.jp

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

Creating peace of mind throughhhonestt andd committed
itt d managementt© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

Message from Directors
The new Ichigo Real Estate Investment Corporation (securities code: 8975)
was established on November 1, 2011 by a merger between the former FC
Residential Investment Corporation, a J-REITJ REIT focusing on residential
properties in urban areas, and the former Ichigo Real Estate Investment
Corporation, a J-REIT focusing on office buildings in the Tokyo Metropolitan
area.
area
p
J-REIT, the new Ichigo
g Real Estate Investment
As a comprehensive
Corporation is committed to maximizing unitholder value by creating successbeyond which could have been generated by either REIT individually.
Yoshihiro Takatsuka
Executive Director
I hi R
IchigoReall E
Estatet t IInvestmenttt Corporation
Cti
Wataru Orii
President & Representative Director
Ichigo REIT Management Co., Ltd.
© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

4

Contents
 Financial Summary for October 2011 Fiscal Period New Ichigo REIT
9 Comprehensive J-REIT with Stable Profitability and Steady Growth
9 Evolution to Comprehensive J-REIT
9 Strengthened Management Structure to Support Growth
9 Expanded Growth Opportunities from Merger
9 Strategic Use of Negative Goodwill

 GrowthGhS
Strategy ffor Significant
Si ifiE
Expansioni
9 Growth Strategy Road Map
9 Strengthen Financial Base
9 Reduced Costs through Merger Synergies
9 Asset-Level Value Enhancement
9 Improve Portfolio Quality

 Future Dividend Policy – Maximizing Unitholders’ Value
Appendix ： Finance / Portfolio Overview / About Ichigo REIT
© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

5

Financial Summary for October 2011 Fiscal Period© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

6

Occupancy （Former FC Residential Investment Corporation）
 Maintaining high and stable occupancy in residential properties
9 Minor decrease in total occupancy from exit of several retail tenants
9 To maintain and increase occupancy, beginning strategic use of model rooms

 Total portfolio occupancy at end of October 2011: 95.7%
Change in Occupancy and Average Rent per Tsubo
15,20

(yen)

100%
Average Rent per Tsubo(Portf olio)
Total Occupancy

20,000
98.3%

98.1%

99.0%

97.8%
95.7%

90%

16,00080%

12,00012,43670%
No. of Properties

11,845

11,795

11,66011,524Oct. 2009

Apr. 2010

Oct. 2010

Apr. 2011

Oct. 2011

16

19

19

19

19

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

8,000

7

Financial Results （Former FC Residential Investment Corporation)
Dividend of ¥7,220 per investment unit（pre-split）
9 Maintained rental income at level of prior period
9 Forecast revised upward due to one
one-off
off income from certain tenants
vacating premises(Million yen)
Category

Apr. 2011 (Actual)Oct. 2011 (Actual)

Initial Forecast

Difference

Major Factors for Variation

Operating revenue

762

787

752

+35

Increase in rental income +38(one-time income arising from a tenant exit)

Operating income

389

402

357

+45

Decrease in rental expenses +10

Ordinary income

229

240

196

+44

―

Net income

224

236

193

+43

―

Dividend per unit

6,856 yen

7,220 yen

No. of properties

19

19

No. of tenants

19

19

Leasable area

34,026.33 ㎡

34,027.28 ㎡

5,910 yen +1,310 yen
19

－

－

－

－

－

－

－

－

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

8

Occupancy (Former Ichigo REIT)
 Increased occupancy via targeted leasing strategy
9 After Ichigo Group became the sponsor, improved leasing with hands-on approach
9 Achieved occupancy of 97.0% for the five main wards of Tokyo— COI Shinbashi
Shi b hi Building
B ildi now fully
f ll occupied
i d with
ith largel
new contract
t t forf approximately
i t l 600 ttsubob Total portfolio occupancy at end of October 2011: 90.6%
Change in Occupancy and Average Rent per Tsubo
(
(yen)
)

15,20

100%
Average Rent per Tsubo(Portfolio)Tokyo Metropolitan Area (5Central Wards)
Tokyo Metropolitan Area
(Other than 5 Central Wards)
Others

24,000
97.0%
95.8%
92.8%

93.3%

92.4%
90.9%

90%

Total

92.1%

88.1%

88.5%
86.7%

90.3%

92 1%
92.1%

20 00020,000

90.6%

88.1%
87.0%

86.1%

82.7%

85.8%
83.6%

85.4%

15,30014,80014,50014,20013,900Oct. 2009

Apr. 2010

Oct. 2010

Apr. 2011

Oct. 2011

22

22

21

20

20

14

14

14

14

14

18

18

18

18

18

54

54

53

52

52

16,00080%(No. of Properties)

70%

Toky o Metropolitan Area
(5 Central Wards)
Toky o Metropolitan Area
(Other than 5 Central Wards)

OthersTotal

12,000© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

8,000

9

Financial Results (Former Ichigo REIT)
Dividend of ¥2,777 per investment unit
9 Rental income increased with higher occupancy than forecast
9 Due to electricity
electricity-savingsaving measures over the summer
summer, decreased utilities
income and costs
9 Merger costs partially expensed on income statement
Category

Apr. 2011 (Actual)Oct. 2011 (Actual)

Initial Forecast

Difference((Million yen)y )Major Factors for Variation

Operating revenue

3,684

3,674

3,652

+22

Increase in rental income +29 (early conclusion ofcontracts, etc.)
Decrease in utilities revenue -17
Increase in other rental income +10

Operating income

1,427

1,457

1,388

+69

Decrease in utilities expenses +15
Decrease in repair expenses +40

Ordinary income

378

591

523

+68

Net income

377

568

522

+46

1,847 yen

2,777 yen

No. of properties

52

52

No. of tenants

532

538

Leasable area

142,218.45 ㎡

141,957.63 ㎡

Merger dividend per unit―
Extraordinary loss -21(Merger related expenses)

2,500 yen +277 yen
52

－

－

－

－

－

－

－

－

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

10

New Ichigo REIT

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

11

Comprehensive J-REIT with Stable Profitability and Steady Growth New Ichigo REIT established on November 1, 2011
9 Seeking stable profitability and steady portfolio growth by combining portfolios ofurban residential properties with stable income and urban office buildings withpotential income gains
9 Expanded assets (¥23.4 bil → ¥107.9 bil) and diversified region and asset types

 Stable Income and Steady Growth
9 In addition to residential properties, ground leases, and long-term leases tostrengthen the income base and generate upside, considering new acquisitions suchas office properties
9 Expect to enhance portfolio quality and acquire new assets, taking advantage of
Ichigo REIT’s negative goodwill and low levels of leverage Comprehensive Portfolio with a Focus on Income
9 Focus on income and stability rather than asset types
9 Seek mid- to long-term asset growth and income stability with attention to financial
and economic conditions and real estate market trends© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

12Evolution to Comprehensive J-REIT■ Ichigo Group Portfolio Diversification by Asset Type(as of August 2011)

 Evolution from Specialized to Comprehensive J-REIT

Land with
Ground Leases
1%

Residential
13%

Residences
Integrationof Portfolios

OfficesComprehensive
J-REIT

Other
2%

Mixed
9%

Of f ice
69%

Retail3%
Development2% Growth Advantage of Comprehensive J-REIT■ Ichigo Group Historical Change in Accumulated
9 Can acquire properties regardless of asset
Assets Under Management (as of August 2011)(bn yen)type → Expansion of investment opportunities
1,352.1
1,400
9 Increased responsiveness and flexibility with respect to
1 200
1,200
externalt
l growthth
9 Can structure portfolio to respond to economic changes 1,000
800
9 Risk diversification by asset type and area
600
9 Maximize
M i i use off IIchigo
hi GGroup kknow-how
h
and
d
400
experience across various asset types
1,308.5

REIT

1,164.5

Operating

177.8

201.2

64.0

Development

791.7

568.7

592.5

612.6

531.8

538.2

538.2

62.0

378.3

200

213.4
87.1

351.4

126 3
126.3

0

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

13

Strengthened Management Structure to Support Growth Changed Investment Guidelines to Create Comprehensive J-REIT
9 Allows acquisition of wide variety of asset types

 Strengthened Sourcing of Assets by Executing Support Contract with
Ichigo Group
9 Executed Support Contract with Ichigo Solutions on property information
and research (November 1, 2011)
9 Strengthened sourcing of assets, property research, and marketing using
the know-how and the network of the Ichigo Group Reorganized the Asset Management Company for Future Growth
9 Segmented functions and centralized the overall real estate control
function to the Investment Management Division
9 Newly established Portfolio Management Division— Dedicated team for portfolio analysis and risk management— Able to structure strategic portfolio for future growth© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

14

Expanded Growth Opportunities from Merger
Merger enables positive resolution of issues that were difficult for the pre-merger
REITs to tackle separately
Hurdles for Resolution

Growth Opportunities from Merger• Concentrated lender formation• Relatively high borrowing cost

• Large-scale early repayment
difficult due to amortization cost of
upfront fees

• Use of negative goodwill allows
proactive early repayment as
necessary• OpportunityO
i to consider
id positiveii
steps to restructuring borrowings• Certain properties have low future
profitabilitypyp
prospectsp• Future impairment risk comingfrom the difference between theacquisition and appraisal values• Impairment risk made it difficult to
do large-scalegrepairsp• Leasing hampered by impairment
risk and “necessary” rent levels• Value enhancement via property
repairp and improvementp• Increase occupancy by leasing
with full focus on total income to
the REIT• Need to improve portfolio quality• Weak dividend levels and unit
prices• Timing of disposition of properties
conditional on market conditions• Difficult to develop a clear
external growth strategy• Using negative goodwill
goodwill, canreplace properties with lowest
upside• Higher dividends enablesconsideration of external growthstrategyt t
with
ith new financingfi
i tto
increase scale and efficiencies

IssuesFinancce
Internnal Growth
External Grow
wth

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

15

Strategic Use of Negative Goodwill
 Negative goodwill generated by mark-to-market of former Ichigo REIT assets(Billion yen)

Debt
55.5
Assets
121.9

Debt
55.5
Assets94.0

Nett A
N
Assetst
66.4

Merger Costs

Negative
Goodwill

C ¥16.5
C.
¥16 5 bil

Net Assets
20.5

Former Ichigo REIT
(as of October 2011)

 Envisaged Main Possible Uses of Negative Goodwill
Finance• Offset refinancing costs due to early repayment• Offset interest rate hedging costs

Internal
Growth• Offset costs from large-scale repair of properties

External
Growth• Offset any losses from asset sales during portfolio upgrades

Other• Offset any dilution of dividends from new unit issuance• Offset any dividend reduction in the event of other special factors© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

16

Growth Strategy for Significant Expansion© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

17

Growth Strategy Road Map

2011/10

Stage I

Stage II

Stage IIILay Foundation for Growth

Full-Scale Growth

Solidify Market Position

2012/4

1st period post merger

2012/10

2nd period post merger

Goal

Seek Dividend of ¥1,200+¥1 200+

Action Plan

■ Financial Strategy
・Strengthen lender base・Reduce borrowing costs■ Internal Growth Strategy
・Reduce operating costs
・Enhance profitability of properties■ External Growth Strategy
・Disposition using negative goodwill
・Gather property information for PO
・Replace properties in timely fashion
・Consider indirect property
acquisition,i iie.g., TK iinvestment

2013/4

3rd period post merger

2013/10

4th period post merger

2014/45th period post merger

2014/10

6th period post merger

PO Targeting Dividend
GrowthFurther Growth of Dividendand Assets■ Financial Strategy
・Strengthen lender base・Strengthen financial base via PO・Obtain credit rating■ Financial Strategy
・Consider non-collateralizedborrowing・Consider bond issuancepmeasures toward further
・Implement
asset growth■ Internal Growth Strategy
・ Enhance profitability of individual
properties■ External Growth Strategy
・Acquire properties via PO・Gather property information for asset
growth and strengthen asset
sourcing© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

■ Internal Growth Strategy
・Continuously enhance profitability ofproperties■ External Growth Strategy
・Further expansion of scale of assets

Growth18

Financial Strategy: 1st and 2nd Periods Post-Merger

Strengthen Financial Base Improve Profitability by Strengthening the Lender Base
9 Actively attract major and regional banks
9 Diversifyy the lender base and re-examine borrowing
g costs
9 Consider early repayment using negative goodwill, depending on loan conditions
9 Consider new debt financing using excess collateral and non-collateralized properties toacquire new assets
9 Increase dividend with new lower-cost financing

 Reduce Borrowing Costs
9 Borrowing costs rose due to lower creditworthiness of bankrupt former sponsor— Current average interest rate: 2.6%
9 Recent borrowing cost significantly lower due to improvement of the balance sheet andstronger creditworthiness of Ichigo Group as sponsor— Interest rate of June 2011 Resona Bank loan: 1.8% (as of November 30, 2011)— Difference from the current average borrowing cost：-0.8%
Average
Interest Rate

2 6%
2.6%

-approx. 0.8%
LatestBorrowingLarge
g ImprovementpPotential

1.8%© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

19Internal Growth Strategy: 1st and 2nd Periods Post-Merger

Reduced Costs through Merger Synergies
 Have reduced SG&A by approx. ¥91 million
9 Reduced administration costs by consolidation of certain custody andadministration service vendors
9 Reduced asset management fee by reduction of asset value via mark-tomarket of former Ichigo REIT assets
9 Raising dividend to reflect these cost savings
Impact on the dividend per unit: approx. + ¥108

 Reduce costs further by
y consolidating
g service vendors
9 Consolidated casualty insurance contracts (as of November 2011)© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

20

Internal Growth Strategy

Asset-Level Value Enhancement (1) Differentiated Asset Management with Hands-On Approach FullF ll D
Deploymentlt off A
Assett ManagementMt Know-How
K
H
and
dN
Networktk
9 Integrate the know-how and broad network of the two pre-merger asset
management companies which focused on different asset types (office andresidential)

 Strengthen Coordination with the Ichigo Group and its Broad Real Estate
Capabilities
9 Use the architectural capability of the Ichigo Group
9 ProactivelyPti l seek
k property
t valuel enhancement,ht evaluate
l t earthquakethkresistance, and carry out thorough risk appraisal
9 Reinforce the Ichigo Brand and its trustworthiness as an asset manager© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

21

Internal Growth Strategy

Asset-Level Value Enhancement (2) Strengthen Leasing Leveraging the Ichigo Brand
9 Soft: Hands-on, asset-level service— Work with PMs to understand local characteristics to be reflected in the leasingg strategy
gy and tenant attraction
promotions— Raise service level by standardizing the quality of the property management service

9 Hard: Reinforce Ichigo Brand by unifying tenant signage, etc.
■ COI Nanpeidai
N
id i Building
B ildi (E(Entrance)t)

BeforeAfter

 Active Leasing Effort
9 Develop and implement targeted leasing strategies for low occupancy properties inregional areas
9 Attract tenants and raise occupancy through understanding local characteristics— COI Shinbashi Building– Changed
g PM strategy,
gy strengthenedg
the relationship,
p and realized full occupancypy from 33.9% level— TK Kichijoji Building– Expanded pool of targeted tenants to drive new demand© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

22

Internal Growth Strategy

Asset-Level Value Enhancement (3) Renovation to Increase Asset Values
9 Low cost value enhancement using Ichigo Group’s architectural capabilities■ COI Ginza 612

Improved appearance in preparation for theredevelopment of the surrounding area
BeforeAfter

9 Improved interior and entrance■ Entrance of TK Kichijoji Building

Before■ Solon Keyakidori Building

After

BeforeAfter Other Measures
9 Lease out unused property spaces to “pop-up” retailers, etc.
© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

23

External Growth Strategy: 1st and 2nd Periods Post Merger

Improve Portfolio Quality
 Using negative goodwill, dispose of properties with little prospect for mid- to longterm value growth while maintaining dividend level (assumed disposition scale:approx. ¥7 billion)
9 Screen properties for disposition based on criteria such as 1) age (old earthquakeresistance standards), 2) occupancy (low or outlook low), 3) maintenance cost (high, or
repairs not justifiable based on likely future value, etc.)
9 Market assets, source buyers, and examine disposition timing in coordination with
Ichigo Group based on Support Contract

 GatherG th informationi f
ti ffor future
f t
propertyt acquisitions
i iti
9 Strengthen property information with support from the Ichigo Group
9 Gather information on prospective seed properties in consideration of possible future
publicbli offeringff i

 Examine a variety of asset acquisition approaches
9 Property acquisition using the excess collateral from non-collateralized properties
9 Indirect property acquisition approaches, e.g., TK investment© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

24

Future Dividend Policy － Maximizing Unitholders’ Value© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

25

Dividend Forecast
9 Forecast for April 2012 dividend: ¥1,100— Merger-driven reduction of costs of JPY 91 million

9 Forecast for October 2012 dividend: ¥1,200¥1 200— Assumes no use of negative goodwill(Million yen)Oct 2011 Period Actual
Category

Operating Revenue

FCR

787

Ichigo REIT

Simple Sum (A)

3,674

4,461

Apr 2012
PeriodForecast (B)(B)-(A)

4,371

-90

Major Factors for Variationin Net Income
Decrease in rental income -50
Decrease in utilities revenue -33(seasonal factor)

Oct 2012
Forecast (C)(C)-(B)

Increase in rental income +38

4,457+86 Increase in utilities revenue +49(seasonal factor)

Decrease in SG&A +91
Operating Income

402

1,457

1,859

1,926

+67 Decrease in depreciation +113

Deccrease in repair expenses +37

2,030+104 Increase in utilities expenses -29

Increase in repair expenses -57

Ordinary Income

Net Income

Dividend per Unit
(Merger Dividend)

240

236

591

568

831

804

7,220 yen 2,777 yen
954 yen(before(before(after unit split)
unit split) unit split)

942

17,508+111

Decrease iin non-operatingDtiexpenses +44

Extraordinary profit +16,567(negative goodwill)+16,704
Extraordinary loss -21 (mergerrelated expenses)

1,100 yen +146 yen© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

Major Factors for Variationin Net Income(seasonal factor)

1,048

1,047

+106

- 16,461 Decrease in extraordinary profit -16,567

1,200 yen +100 yen

26

Effective Use of Negative Goodwill
On-going ability to pay full dividends, as any asset disposition costs to
upgrade portfolio will be absorbed by negative goodwill
9 Over the long-term, expect to increase the dividend organically without use of negative
goodwill
Dividend Forecast April 2012

Dividend
per unit

SGA Reduction

Rental income

Other(merger expenses inprior period
Reduction of not yet expensed)
non-operating
nonoperatingexpenses＋ ¥28MM＋ ¥44MM＋ ¥91MM- ¥25MM（Net Profit ）¥804MM↓
Dividend per unit

¥ 954

In case of losses fromasset sales, etc.

- ¥αMM

April 2012（
（Current
Profit ）¥942MM↓
Per unit dividend

Calculation of per unit distribution based on operating profit where
the negative goodwill from merger is recorded as special profit anddeducted from the tax base for calculation of distributions

Negative
Goodwill¥1,100Effective usegof Negative
Goodwill

Maintainstabledividends
April 2012
Per unit
dividend¥1,100Adjusted pre-merger dividend asof October 2011 for each REIT
© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

27

Full Focus on Raising Dividend
Raise dividend by addressing two key issues of reducing borrowing costs
and increasing office rental income■ Effect of reduction of borrowing costs on dividend[Assumption] Refinanced Loan Amount：JPY10 billion
ChangeDecrease in Interest
Expenses (per Period)

-0.2%

-0.4%

-0.6%

-0.8%

-1.0%

10 mm yen

20 mm yen

30 mm yen

40 mm yen

50 mm yen

+35 yen+47 yen+59 yen

Effectonondistribution
dividend per
Effectperunitunit by reduction ofinterest

Dividend per Unit

+11 yen+23 yen■ Effect of increase in rental income on dividend[Assumption] Higher occupancy at former Ichigo REIT office assets where occupancy can be raised(O 2011rental
(Oct.
2011
income: JPY1.91
1 91 billion))
Change

+0.4%

+0.8%

+1.2%

+1.6%

+2.0%

8 mm yen

15 mm yen

23 mm yen

31 mm yen

38 mm yen

+9 yen+18 yen+27 yen+36 yen+45 yenIncrease in Rental
IncomeEffect on dividend per unit

Dividend per Unit

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

28

Appendix: Finance© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

29

Loan Details
As of November 1, 2011

Lender
BNY Mellon Trust
Aozora Bank, Ltd.
The Tokyo Star Bank, Limited
The Kagawa Bank
Bank, LtdLtd.
The Tokyo Star Bank, Limited
AIG Edison Life Insurance Company
The Tokyo Star Bank, Limited
Mizuho Trust & Banking Co
Co., LtdLtd.
(Loan Backed by Trust Assets)
ORIX Bank Corporation
Resona Bank, Limited
GE JapanJ
CorporationCi
Mizuho Trust & Banking Co., Ltd.
(Loan Backed by Trust Assets)Prudential LPS

Outstanding balance((mm y
yen))
300
3,910
2,955
1 462
1,462
5,518
3,800
3,725

Total

Drawdown Date

Repayment dateNovember 29, 2010
February 29, 2008
November 30, 2010
November 30
30, 2010
January 29, 2010
March 16, 2006
March 31, 2010

November 29, 2011
August 31, 2012
November 30, 2012
November 30
30, 2012
January 29, 2013
March 16, 2013
March 31, 2013

2,050 September 17, 2010

March 14, 2014

2,000 June 29, 2011
30 000 November
30,000N
b 30
30, 2010

April 30, 2014M 30
May30, 2014

2,961 November 30, 2010

May 25, 2016

58,682

LTV 49.3%
LTV:
49 3% (using November 1, 2011 asset value)© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

30

Ratio of Variable/Fixed Rate Loans and Distribution of Lenders

As of November 1, 2011

■ Breakdown of Variable and Fixed Rate Loans■ Distribution of Lenders
ResonaBank
3%

KagawaMizuho Trust (LoanBank
Backed by Trust Assets)
2%
Prudential LPS
5%
Mizuho Trust(Loan Backed by
Trust Assets)
AIG Edison Life
ORIX Bank

Fixed Interest
28%

IInsurance
6%

Variable Interest
64%

Aozora Bank
7%

pp Variable
CappedInterest
8%© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

BNY
Mellon
Trust
1%

4%

GE JapanCorporation
51%

Tokyo Star Bank
21%

31

Distribution of Repayment Dates(Million Yen)

As of November 1, 2011

40,00030,00030,00020,00017,215

10,000

4 050
4,050

3 851
3,851

2,732

300
0

Apr 2012

Oct 2012

Apr 2013

Oct 2013

Apr 2014

Oct 2014© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

Apr 2015

Oct 2015

Apr 2016

Oct 2016

32

Appendix: Portfolio Overview© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

33

Portfolio Diversification
As of November 1, 2011

■By Use■ Portfolio Overview■ By Region
Other
13%

No. of Properties

71

Middle： Acquisition
Price (bn yen)

Total Acquisition Price

107,978 mm yen

Below： % of portfolio

Total Appraisal Value

104 902 mm yen
104,902

Leasable Area

175,984.91㎡ *1

Occupancy

91.6% *2

Residence
18%

Sapporo
0.5
1%

Tokyo
Metropolitanarea
76.3
71%

Office69%■ By Price

Sendai1.8
2%0~1 bn yen
19%
3 bn yen~
33%

Nagoya12.2
11%Hiroshima
0.8
1%

Kansai4.9
4%Fukuoka
1.4
1%

Others9.7
9%2~3 bn yen
9%

1~2 bn yyen
39%

■ By Age
30 years~
19%
0~10 years
34%

20~30
years
25%

*1 Leasable area is the sum of the leasable areas as of October 31, 2011 of the two investment corporations before merger.
*2 Occupancy is estimated based on the occupancy as of October 31, 2011 of the two investment corporations before merger.
© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

10~20
years
22%

Average:20.5 years
34Portfolio Description (1)A off OctoberAs
O t b 31,
31 2011
Use

No.

O-01

OfficeProperty

COI Shinbashi Building

Area

Address

AcquisitionPrice(mm yen)Central Tokyo

Shinbashi, Minato-ku, Tokyo

6,110

NRA (m 2)

5,519.98

Occupancy
(%)

100.0

Appraisal
Oct 2011(mm yen)

6,110

Cap rate
(%)

―

O-02

g
COI Nishisando Building

Central Tokyoy

Yoyogi,y g , Shibuya-ku,y, Tokyoy3,254,

4,863.79
,

96.2

3,254
,

5.3

O-03

MTC Building

Central Tokyo

Shiba, Minato-ku, Tokyo

2,740

4,097.63

100.0

2,740

5.3

O-04

COI Nanpeidai Building

Central Tokyo

Nanpeidaicho, Shibuya-ku, Tokyo

1,920

1,925.24

100.0

1,920

4.7

O-05

Joware Hanzomon

Central Tokyo

Hayabusacho, Chiyoda-ku, Tokyo

1,550

2,080.37

76.4

1,550

5.1

O-06

COI Hijirizaka Building

Central Tokyo

Mita, Minato-ku, Tokyo

1,200

1,947.65

100.0

1,200

5.5

O-07

COI Shibuya
y Kamiyamachoy
BuildinggCentral TokyoyKamiyamacho,y, Shibuya-ku,y, Tokyoy1,505,

1,321.54
,

100.0

1,505
,

4.9

O-08

COI Akasaka 5 Chome Building

Central Tokyo

Akasaka, Minato-ku, Tokyo

735

687.78

100.0

735

4.9

O-09

COI Shibazonobashi Building

Central Tokyo

Shiba, Minato-ku, Tokyo

1,100

1,602.29

100.0

1,100

5.3

O-10

COI Ebisu Nishi Building

Central Tokyo

Ebisu-nishi, Shibuya-ku, Tokyo

1,917

1,484.39

100.0

1,917

5.1

O-11

COI Ginza 612

Central Tokyo

Ginza, Chuo-ku, Tokyo

1,773

1,395.58

94.6

1,773

4.8

O-12

COI Uchikanda BuildinggCentral TokyoyUchikanda,, Chiyoda-ku,y, Tokyoy1,140,

1,379.33
,

100.0

1,140
,

5.3

O-13

COI Kudan-Minami Building

Central Tokyo

Kudan-Minami, Chiyoda-ku, Tokyo

387

490.91

91.0

387

5.1

O-14

COI Yotsuya 4 Chome Building

Central Tokyo

Yotsuya, Shinjuku-ku, Tokyo

550

780.64

100.0

550

5.2

O-15

COI Akasaka Tameike Building

Central Tokyo

Akasaka, Minato-ku, Tokyo

580

494.14

80.6

580

4.8

O-16

DSM Jimbocho Building

Central Tokyo

Kanda Jinbocho, Chiyoda-ku, Tokyo

1,820

1,931.48

100.0

1,820

5.1

O-17
O
17

DSM Nihonbashi Kakigaracho Building

Central Tokyo

Nihonbashi Kakigaracho, Chuo-ku,
Chuo ku, Tokyo

1,150

2,379.80

89.1

1,150

5.3

O-18

COI Kudan 2 Chome Building

Central Tokyo

Kudan Minami, Chiyoda-ku, Tokyo

763

1,288.31

100.0

763

5.2

O-19

COI Kudan 3 Chome Building

Central Tokyo

Kudan Minami, Chiyoda-ku, Tokyo

844

1,318.80

100.0

844

5.3

O-20

COI Gotanda Building

Central Tokyo

Higashi-Gotanda, Shinagawa-ku, Tokyo

5,060

5,346.76

95.3

5,060

5.7

O-21

Benex S-2

Toky o Metropolitan Area

Shinyokohama, Kohoku-ku, Yokohama City, Kanagaw a

1,816

4,183.11

77.5

1,816

5.9

O 22
O-22

COI Minami-Ikebukuro
Minami Ikebukuro Building

Toky o Metropolitan Area

Minami Ikebukuro Toshima
Minami-Ikebukuro,
Toshima-ku,
ku Tokyo

1 460
1,460

1 490 311,490.31

100 0
100.0

1 460
1,460

52
5.2

Post-merger acquisition price as of November 1, 2011
Cap rate of COI Shinbashi Building using the adjusted inwood method, assuming future redevelopment of the asset, is 4.9%
© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

35

Portfolio Description (2)A off OctoberAs
O t b 31,
31 2011
Use

No.

OfficeProperty

Area

Address

AcquisitionPrice(mm yen)

O-23

Technos Nakano Building

Toky o Metropolitan Area

Arai, Nakano-ku, Tokyo

764

O-24

COI Eitai Building

Toky o Metropolitan Area

Eidai Koto-ku
Eidai,
Koto-ku, Tokyo

O-25

COI Yokosuka Bayside Building

Toky o Metropolitan Area

Wakamatsu-cho, Yokosuka City, Kanagawa

O-26

Chitose Building

Toky o Metropolitan Area

Ohashi, Meguro-ku, Tokyo

O-27

Route Ikebukuro Building

Toky o Metropolitan Area

Ikebukuro, Toshima-ku, Tokyo

O-28

Nishi-Gotanda AccessCentral Tokyo

NRA (m 2)

Occupancy(%)

Appraisal
Oct 2011(mm yen)

Cap rate(%)

1,250.85

100.0

764

5.9

1 490
1,490

2 602 312,602.31

100 0
100.0

1 490
1,490

59
5.9

971

2,186.73

78.2

971

6.5

2,030

2,385.69

100.0

2,030

5.5

639

1,261.91

100.0

639

5.6

Nishigotanda, Shinagawa-ku, Tokyo

765

1,311.21

100.0

765

5.6

Kichijoji Honcho, Musashino-shi, Tokyo

2,160

4,146.86

86.0

2,160

5.8

604

2,186.41

73.7

604

7.6

O-29

TK Kichijoji Building

Toky o Metropolitan Area

O-30

Ibaraki Kowa Building

Other Regional Cities

Eidaicho, Ibaraki City, Osaka

O-31

Sendai Ichibancho Building

Other Regional Cities

Ichibancho, Aoba-ku, Sendai City, Miyagi

1,384

5,675.73

84.8

1,384

6.2

O-32

COI Hiroshima Kamiyacho Building

Other Regional Cities

Motomachi, Naka-ku, Hiroshima City, Hiroshima885

2,893.29

81.8

885

6.3

O-33

COI Mei-Eki Building

Four Major Cities Meieki, Nakamura-ku, Nagoya City, Aichi

837

2,063.52

100.0

837

6.0

O-34

COI Nagoya Plaza Building

Four Major Cities Sakae, Naka-ku, Nagoya City, Aichi

4,705

3,928.12

91.1

4,705

5.4

O-35

COI Sendai Chuo Building

Other Regional Cities

Chuo, Aoba-ku, Sendai City, Miyagi

510

2,378.07

87.4

510

6.1

O-36

Solon Keyakidori Building

Four Major Cities Kego, Chuo-ku, Fukuoka City, Fukuoka,

788

1,969.05

39.6

788

6.1

O-37

CRD Marunouchi

Four Major Cities Marunouchi, Naka-ku, Nagoya City, Aichi

6,710

8,009.11

98.3

6,710

5.4

O-38
O
38

Toyamaeki Nishi Building

Other Regionalg
CitiesJinzuhonmachi, Toyama City, Toyama

1,650

8,601.71

98.9

1,650

6.9

O-39

Daihyaku Mirai-Shinkin Building

Other Regional Cities

Niagemachi, Oita City, Oita

1,100

3,247.03

92.8

1,100

6.8

O-40

Kearney Place Saga

Other Regional Cities

Ekimae-Chuo, Saga City, Saga659

2,786.37

91.4

659

7.0

O-41

Kearney Place Kanazawaeki-Mae

Other Regional Cities

Horikawashinmachi, Kanazawa City, Ishikawa

533

2,454.09

73.4

533

6.5

O-42

COI Takamatsu Building

Other Regional Cities

Kotobukicho, Takamatsu City, Kagawa

3,010

6,329.33

96.7

3,010

7.1

O 43
O-43

COI Toyama
T
Shinsakuramachi
Shi
k
hi B
Building
ildi

Oth Regional
Other
R i
l Citi
CitiesShi
Shinsakuramachi,khi TToyama Cit
City, T
Toyama367

2 089 68
2,089.68

70 6
70.6

367

80
8.0

O-44

Akita Sanno 21 Building

Other Regional Cities

Sanno, Akita City, Akita

560

3,512.36

55.3

560

8.1

O-45

COI Niigata Building

Other Regional Cities

Higashiodori, Chuo-ku, Niigata City, Niigata

1,830

6,577.22

76.5

1,830

7.2

Subtotal - Office

74,325

127,856.48

74,325

Post-merger acquisition price as of November 1, 2011
© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

36

Portfolio Description (3)A off OctoberAs
O t b 31,
31 2011
Use

Residence

Area

AcquisitionPrice(mm yen)

NRA (m2)

Occupancy(%)

Appraisal

No.

Property

R-01

ForeCity Roppongi

Central Tokyo

Roppongi, Minato-ku, Tokyo

1,730

1,663.87

96.4

1,360

5.1

R 02
R-02

ForeCity Azabujuban

Central Tokyo

Mita Minato-ku,
Mita,
Minato ku Tokyo

1 140
1,140

1 111 20
1,111.20

91 7
91.7

1 070
1,070

50
5.0

R-03

ForeCity Azabujuban No.2

Central Tokyo

Mita, Minato-ku, Tokyo

1,250

1,177.20

86.1

1,150

5.0

R-04

Bureau Takanawadai

Central Tokyo

Shirokanedai, Minato-ku, Tokyo

1,360

1,677.88

100.0

1,010

6.2

R-05

ForeCity Shirokanedai

Central Tokyo

Shirokanedai, Minato-ku, Tokyo

824

927.90

97.5

669

5.3

R-06

B-Site Hamamatsucho

Central Tokyo

Hamamatsucho, Minato-ku, Tokyo

701

821.84

100.0

530

6.4

R-07

ForeCity Akihabara

Central Tokyo

Kanda Sakumacho, Chiyoda-ku, Tokyo

2,520

3,452.29

100.0

2,040

5.3

R-08

Sweet One Court

Central Tokyo

Irifune, Chuo-ku, Tokyo

786

1,030.63

93.8

630

5.4

R-09

B-site Ginza East

Central Tokyo

Shintomi, Chuo-ku, Tokyo

946

1,332.87

100.0

726

6.4

R-10

ForeCity Sasazuka

Central Tokyo

Sasazuka, Shibuya-ku, Tokyo

1,050

1,452.61

100.0

848

5.4

R-11

Gran Presso Kawadacho

Central Tokyo

Kawadacho, Shinjuku-ku, Tokyo

592

667.16

88.8

467

5.4

R-12

ForeCity Sakurashinmachi

Toky o Metropolitan Area

Sakurashinmachi, Setagaya-ku, Tokyo

R-13

ForeCity Shinkamada

Toky o Metropolitan Area

Shinkamada, Ota-ku, Tokyo

R-14

ForeCity Nakaochiai

Central Tokyo

Nakaochiai, Shinjuku-ku, Tokyo

R-15

ForeCity Tomigaya

Central Tokyo

Tomigaya, Shibuya-ku, Tokyo

R-16
R
16

ForeCity Ryogoku

Toky o Metropolitan Area

Midori, Sumida-ku,
Sumida ku, Tokyo

1,080

1,572.39

100.0

1,020

5.4

R-17

ForeCity Toyosu

Toky o Metropolitan Area

Shinonome, Koto-ku, Tokyo

1,349

3,058.24

100.0

1,540

5.6

R-18

ForeCity Nishihonmachi

Four Major Cities Nishihonmachi, Nishi-ku, Osaka City, Osaka

927

2,675.88

100.0

938

6.1

Subtotal - Residence

20,00628,266.49

Address

Oct 2011(mm yen)

Cap rate(%)

932

1,182.96

96.2

731

5.4

1,040

1,756.33

97.4

895

5.7

435

599.30

100.0

356

5.4

1,341

2,105.94

91.6

1,540

5.2

17,520Post-merger acquisition price as of November 1, 2011
© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

37

Portfolio Description (4)A off OctoberAs
O t b 31,
31 2011
Use

No.

Other

Property

AcquisitionPrice(mm yen)

NRA (m 2)

Occupancy(%)

Appraisal

Area

Address

3,410

5,760.79

87.3

2,820

5.6

1,970

1,220.02

100.0

1,970

5.0

Z-01

Falcon Shinsaibashi Building

Four Major Cities

Higashi-Shinsaibashi, Chuo-ku, Osaka City, Osaka

Z-02

Fiesta Shibuya

Central Tokyo

Udagawacho, Shibuya-ku, Tokyo

Oct 2011(mm yen)

Cap rate(%)

Z-03

Burc Omori

Toky o Metropolitan Area

Omorikita, Ota-ku, Tokyo

3,218

5,358.25

87.1

3,218

6.2

Z-04

Pagoda Asakusa

Toky o Metropolitan Area

Kaminarimon, Taito-ku, Tokyo

1,640

2,091.27

100.0

1,640

5.6

Z-05

Regalo Building

Toky o Metropolitan Area

Haramachida, Machida City, Tokyo

1,310

2,183.65

100.0

1,310

6.0

Z 06
Z-06

L
Lespoir
i 296

T k o Metropolitan
Toky
M t
lit
Area
A

Mi
Minami-Saiw
i S i ai,i Ni
Nishi-ku,
hi k Y
Yokohamak h
CitCity, K
Kanagaw a903

1 282 92
1,282.92

100 0
100.0

903

57
5.7

Z-07

El Centro Sapporo

Four Major Cities

Minami 2 jo Nishi, Chuo-ku, Sapporo City, Hokkaido

558

1,199.43

86.7

558

6.1

Z-08

Daimyo Balcony

Four Major Cities Daimyo, Chuo-ku, Fukuoka City, Fukuoka

638

765.61

100.0

638

6.3

Subtotal - Other

13,647

19,861.94

13,057

Total

107 978
107,978

175 984 91
175,984.91

104 902104,902

Post-merger acquisition price as of November 1, 2011
© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

38

Appendix: About Ichigo REIT

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

39

Investor Composition (Former FCR as of October-End)A off OctoberAs
O t b 31,
31 2011■ Major Unitholders■ Number of units by unitholder type
Name

Units

Share

1

Ichigo Trust

13,70042%

2

FAL HOLDINGS PTE. LTD.

6,205

19%

3

The Nomura Trust and banking Co., Ltd.

1,757

5%

4

GOLDMAN, SACHS & CO. REG

1,624

5%

5

Japan Trustee Service Bank, Trust Account

1,379

4%

6

Aiden Co.,, Ltd.

644

2%

7

The Okinawa Kaiho Bank, Ltd.

580

2%

8

Trust & Custody Service Bank, Ltd., Securities Investment
Trust Account

433

1%

9

GOLDMAN SACHS INTERNATIONAL

295

1%

10

Minami Nippon Bank, Ltd.

235

1%

26,85282%

Total

Domestic
IndividualIndi
id al & Other
4,312
Financial
Institutions
4,690

Foreign
Corporation &Individuals
22,247

Domestic
Corporations
1,451■ Number of unitholders by type
Financial
Institutions
22

Foreign
Corporation &Individuals
30

Domestic
Corporations
39

Domestic
Individuals &Others2,006© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

40

Investor Composition (Former Ichigo REIT as of October-End)A off OctoberAs
O t b 31,
31 2011■ Major Unitholders■ Number of units by unitholder type
Name

Units

Share

1

Ichigo Trust

65,89532%

2

Jupiter LLC

35,62317%

3

GOLDMAN SACHS INTERNATIONAL

24,660

12%

4The Nomura Trust and banking Co., Ltd.

10,535

5%

5Japan Trustee Service Bank, Trust Account

8,110

4%

6

Trust & Custody Service Bank, Ltd., Securities Investment
Trust Account

6,013

3%

7

PROSPECT JAPAN FUND LIMITED

4,635

2%

8

The Master Trust Bank of Japan, Trust Account

3,667

2%

3,519
,

2%

1,866

1%

164,52380%

910

DEUTSCHE BANK AG LONDON-PB NON-TREATY
CLIENTS 613
BBH FOR OPPENHEIMER QUEST INTERNATIONALVALUE FUND
Total

Domestic
Individual & Other
25,870Financial
Institutions
30,445

Foreign
Corporations &I di id l
Individuals
111,342

Domestic
Corporations
36,984■ Number of unitholders by type
Foreign
Corporation &Individuals
58
Domestic

Financial
Institutions
22

Corporations
78

Domestic
Individuals &Others6,220© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

41

Overview of Ichigo REIT
As of November 1, 2011
Name

Ichigo Real Estate Investment Corporation

Securities Code8975

Address

1-1-1 Uchisaiwai-cho Chiyoda-ku, Tokyo

Executive Director

Yoshihiro Takatsuka

Portfolio

71 properties

Portfolio Value

107,978 million yen （Based on acquisition price）

Fiscal Periods

November 1 – April 30 and May 1 – October 31

Asset Manager

Ichigog REIT ManagementgCo.,, Ltd.

President of
Asset Manager

Wataru Orii

© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

42

Disclaimer
These materials are for informational purposes only. These materials do not constitute or form a part of, and should not be
construed as, an offer to sell or a solicitation of an offer to buy any securities of Ichigo Real Estate Investment Corporation(Ichigo REIT). You should consult with a representative of a securities firm if you intend to invest in any securities of Ichigo REIT.
These materials may contain forward-looking statements regarding the intent, belief or current expectations of management ofI hi REIT with
Ichigoith respectt to
t financial
fi
i l condition
diti andd future
f t
results
lt off operations.
ti
These
Th
statementst tt are basedbd on certaint i
assumptions founded on currently available information. Accordingly, such statements are subjects to risks, uncertainties andassumptions and there is no assurance as to actual financial conditions or results of operations. Actual results may vary fromthose indicated in the forward-looking statements. Accordingly, please refrain from solely relying on these statements.
These materials have been created byy the managementgof Ichigo
g REIT and Ichigo
g REIT ManagementgCo.,, Ltd. ((IRM)) with thebelief that the information contained is accurate. However, there is no assurance given as to the accuracy, certainty, validity or
fairness of any such information.
Please note that the content of these materials is subject to revision or retraction without prior notice.
No copying or reproduction of these materials or part of these materials is allowed without obtaining prior consent from Ichigo
REIT and IRM.

Contact:

Ichigo REIT Management Co., Ltd.
TEL：03-3502-4891
FAX：03-3502-4894
IR REIT@i hi h ldi
IR_REIT@ichigo-holdings.co.jp
jwww.ichigo-reit.co.jp© 2011 Ichigo REIT Management Co., Ltd. Ichigo Real Estate Investment Corporation All rights reserved.

43